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"Several of those killed were foreign nationals," Azizollah Seifi, the governor of the central Yazd region where the blast occurred late Sunday, told ISNA news agency. He did not provide further details on the fatalities.
The explosion at the Ghadir-e Yazd Steel Factory was being investigated.
One local MP, Ali Akbar Oliaee, told ILNA news agency it appeared the factory had been melting down scrap metal that contained unexpended munitions.
"Amongst the scrap metal was ammunition which had not worked, and this caused the blast," he was quoted as saying.